Long GBP/CAD at 1.6355 – Westpac

Westpac analysts are recommending to go long on GBP/CAD cross at current rate of 1.6360 for the target price 1.6775, while maintaining a stop loss of 1.6230.

Key Quotes

“Rationale:

• At least one level of UK uncertainty has been resolved
• Selection of Boris Johnson may see a “honeymoon” as his Cabinet forms
• Newly elected EU officials and Brexit negotiators may be more open to discussions
• Johnson may initiate tax and policy changes to bolster a market friendly profile
• A lift in sentiment could trigger recently absent investment and property activity
• As Haldane states, BoE may have less dovish stance despite Carney’s “Sea Change”
• Canada may be regaining growth momentum, but late Oct. elections will create uncertainty
• US House is in no rush to ratify USMCA trade arrangements.”